Do Chinese companies have problems in moving money offshore, or they simply have more homework to do?

When Anbang abruptly terminated its attempt to acquire US hotel chain Starwood in late March despite sweetening its offer several times in three weeks to upstage its rivals, many industry experts had said that the deal was being clocked by the Chinese authorities.

However, three months later when Anbang pulled out from another deal, after US authorities raised doubts about the insurer’s company’s shareholding and financing structure, there were many who felt that the crux of the problem was within the company itself.

But Anbang’s travails are not unique. In fact, it was following in the footsteps of several other Chinese companies who had paid hefty premiums to the offer price to outbid competition in mega deals.

“They (Chinese buyers) tend to wait until the process has gone through and let the other buyers do the due diligence and price negotiations … and they would think ‘if it is good for other buyers, it is going to be good for us, so just add a bit and we can close the deal quickly’,” said Itamar Har-Even, co-founder and co-CEO of Ion Pacific, who has participated in several deals involving Chinese companies.

But the trick does not work always.